Dell’s Globalization of Business

Dell’s Globalization of Business

Dell, Inc. the largest direct sale computer vendor in the world, selling servers, desktops, laptops, workstations, printers, monitors, storage solutions, and other computer peripherals. Since its inception in 1984 Dell was a pure hardware vendor for much of its existence, but with the acquisition in 2009 of Perot Systems, it entered the market for IT services. With a unique business model for computer vendor industry named “build-to-order” or direct sales philosophy, Dell expanded its footprints as one of the most successful global company. Using the most advance technologies with the benefit of globalization, Dell built its competitive advantage as a low cost provider of customized product offerings.

To capture the advantage of low cost production, in 1994 Dell enthusiastically moved to the use of Internet to coordinate and control its globally dispersed production system. It was so efficient that now it holds only three days’ worth of inventory at its assembly locations. This advancement in reducing inventory cost to a minimum level was not possible unless company use Microprocessor and Internet. Dell’s Internet-based system records orders for computer equipment as customers submit them via the company’s Web site, then immediately transmits the resulting orders for components to various suppliers around the world, which have a real-time look at Dell’s order flow and can adjust their production schedules accordingly.

Besides, given the low cost of airfreight, Dell can use air transportation to speed up the delivery of critical components to meet unanticipated demand shifts without delaying the shipment of final product to consumers. Dell is also bestowed with the blessings of containerization when they ship their product around the world for cheapest delivery with adequate time.

Dell also has used modern communications technology to outsource its customer service operations to India. Recent development in telecommunication made such an opportunity for Dell by reducing cost and speeding delivery of services. When U.S. customers call Dell with a service inquiry, they are routed to Bangalore in India, where English-speaking service personnel handle the call.

However, based on modern technologies, dell not only had taken the advantage of globalization of production but also the advantage of globalization of market. Its “build-to-order”- model generates online based orders from customers around the world. Internet based payment methods, telecommunications and World Wide Web helps customers of all countries to place order and purchase from dell according to their unique needs. Commercial jet aircraft and containerization are other technologies that helps Dell to reach customer anywhere in the world.